Contractors who were providing medical services to illegal immigrants at the border bilked the Department of Homeland Security out of more than $1 million by asking for travel reimbursement payments for which they didn’t qualify.
About 30 employees were in on the scam — nearly a third of the contracted medical worker staff, the Justice Department said.
The Justice Department secured a guilty plea last week from one of them, Neery Velazquez, who had taken Uncle Sam for more than $180,000.
Velazquez admitted to living in the San Diego area but claimed he still lived in Las Vegas and commuted to his border job. By claiming to live more than 50 miles away from his duty station, he was deemed a “traveler” and allowed to collect travel expenses for lodging and food.
He admitted to one count of making a false claim, a felony.
“Every dollar stolen through fraudulent travel claims is a dollar taken directly from the pockets of hardworking taxpayers,” said Adam Gordon, the U.S. attorney in Southern California.
His office said the case against Velazquez grew out of a broader investigation into travel fraud among the contract medical corps in San Diego. They looked at 100 employees from the same contractor and found nearly a third of them “were committing some form of travel benefits fraud.”
Combined, they collected about $1.6 million in falsified travel reimbursement claims.
After the fraud was spotted, the Justice Department said, CBP made changes and the travel payments for the contractors dropped from $3.9 million a month in 2023 to $3.1 million a month in 2024.
The total savings worked out to $9.6 million, DOJ said.
After some high-profile deaths of sick children at the border in the first Trump administration, CBP created a medical corps to perform screenings and help newly arrived migrants get care, regardless of their legal status.
The rollout has faced allegations of contract malfeasance and questions about the government’s responsibility to deliver medical care.
Velasquez was living in Las Vegas when he began the contract job in San Diego in January 2020.
By Aug. 26 of that year, he had moved to San Diego full time, but he didn’t change his information and for the next three years, he claimed travel reimbursements, which the contractor submitted to Customs and Border Protection for payment.
For January 2022, for example, he claimed $6,789 in housing, food and incidentals.
Not content with that fraud, by September of that year, he was also inflating his expenses, forging a rental agreement that made it look like he was paying $5,600 a month for an apartment. In reality, he was paying thousands of dollars less — and lived there full time.
All told, he tried to claim $244,019, and the government paid out $181,082 of that.
The court documents don’t say who the contractor was, but a profile for Neery Velasquez on LinkedIn says he worked for Loyal Source Government Services from November 2019 to October 2024, which covers the time of the fraud.
Loyal Source says it provides health care staffing for government agencies, including Homeland Security.
The firm didn’t respond to a request for comment. Neither did Velazquez’s court-appointed lawyer.
